One Child Policy and its Effects. The one-child policy in China is held by many as the decisive igniter of the steep decline in fertility rates – defined as the number of births per woman during her lifetime – in China. Contrary to the common understanding, the one-child policy introduced in 1979 did not precede the fertility transition – i.e. transition from high to low fertility rates – but instead followed its onset by 16 years in urban areas and 10 years in rural areas. Increase in female education attainment, female participation in the labor market and increased age at marriage were other circumstantial factors which ignited the fertility transition in China. The main consequence of the introduction of the one child policy was to hasten – not to spark – the fertility transition thus achieving exceptionally low fertility rates in the Chinese rural population within a very short period[1]. The pace and rapidity of this transition created an economic gift which today is dissipating.

Age Structure and Economic Miracle. China was able to achieve miraculous rates of economic growth because its cohort of working-age population increased at a faster pace that the youth cohort did. This was the economic gift that a hastened fertility transition produced. As the youth dependency burden decreased the growth of per capita income accelerated. In this way less resources were to be spent on dependents such as children. The decisive factor of a rapid demographic transition therefore is that it changes the age profile of a population.

Who Is to Support the Elders? (source ladiesagainstfeminism.com)

Fast and Furious: the Economic Gift Dissipates. The disproportionally high share of working age adults does not last forever however and the economic gift can soon dissipate. When the fertility transition advances to later stages, the ratio of young and elderly population (the dependent population) increased vis-a’-vis the working-age cohort. In China in particular the number of births dropped in a drastic way in the last 30 years: it took China 20 years to reach an age profile which took Britain 60 years. As the population ages and the number of births declines, the current model of elderly depending on the family fits ill with the current demographic trends and socioeconomic changes. Firstly, with a departure from the model one-family-under-one-roof towards nuclear households, a majority of the elderly is living in different cities from their offspring (the problem is more acute in rural areas than in urban areas). Secondly, as a result of the one-child policy which means one child per couple, the future cohorts of elderly will depend on a smaller number of offspring as compared to the present cohort. Thirdly, as life expectancy is increasing the elders are to be sustained longer by their offspring. The rising ratio of the elders in the Chinese population poses the question of how elders are to be offered financial support. Welfare and pension systems are not in place to fill the void left by shrunken families. A rapidly ageing population poses other problems too: as the number of births dropped, the supply of young, cheap labor is drying up, which in turn poses problem to the prospects of economic growth. China, many analyst say, became old before it became rich.

[1] “Demographic Transition in Asia and Its Consequences”. Hussain, Dyson and Cassen